The determinants of home-base-augmenting and home-base-exploiting Technological activities: some new results on multinationals’ locational strategies

The aim of this paper is to highlight the factors that explain the choice faced by MNCs between the two main location strategies identified in the literature on internationalization of R&D and related technological activities: home-base-exploiting strategy and home-baseaugmenting strategy. We do this using a large database on the patenting activities of MNCs across a range of different countries. According to our findings, based on logit models, the factors increasing the probability of choosing the home-base-augmenting strategy are: the volume of technological activity (although this effect is very weak), the degree of technological specialization (the opposite of technological diversification) and the nationality of the firm. The estimates show that there is no significant effect of the current level of technological internationalization. 1 An earlier version of this paper was presented at the DIME workshop, Juan-les-Pins (France) 10-11May 2007, and at University of Lodz (Poland), 8 June 2007. We thank B. Suchecki (University of Lodz, Poland) for this help concerning the estimations.